Investing Research Articles

How can investors estimate the value of musical assets as an alternative investment? In their January 2025 paper entitled “Pricing Music Royalty Assets”, Luis Villalobos, Yuao Peng, Ananya Mohapatra, Caroline He, Tiffany Filawo, Sasha Stoikov and Umu Cetin develop a royalty decay model to predict revenue streams for music assets. They then apply a discounted… Keep Reading

Can fund managers, and thereby individual investors, reliably exploit academic research on equity factors? In his January 2025 paper entitled “Do Factor Strategies Beat the Market?”, Edward McQuarrie reviews differences between the results of academic factor studies and fund manager/investor experience, with focus on the size effect (small stocks outperform) and the value premium (value… Keep Reading

Recent research in accounting and finance finds that large language models (LLM) beat humans on a variety of related tasks, but the black box nature of LLMs obscures why. Is LLM outperformance real? In his December 2024 paper entitled “Caution Ahead: Numerical Reasoning and Look-ahead Bias in AI Models”, Bradford Levy conducts a series of… Keep Reading

Do annual stock picks from the Meta AI large language model beat the market? To investigate, we ask Meta AI to pick the top 10 stocks for each of 2020-2024 based on information available only before each year. For example, we ask Meta AI to pick stocks for 2020 as follows: “Limiting yourself strictly to… Keep Reading

Below is a weekly summary of our research findings for 1/27/25 through 1/31/25. These summaries give you a quick snapshot of our content the past week so that you can quickly decide what’s relevant to your investing needs. Subscribers: To receive these weekly digests via email, click here to sign up for our mailing list.

Do annual stock picks from the ChatGPT large language model beat the market? To investigate, we ask ChatGPT to pick the top 10 stocks for each of 2020-2024 based on information available only before each year. For example, we ask ChatGPT to pick stocks for 2020 as follows: “Limiting yourself strictly to information that was… Keep Reading

How can researchers ensure that large language models (LLM), when tasked with time series forecasting, do not inject look-ahead bias and thereby inflate measured predictive power? In his brief November 2024 paper entitled “Look-Ahead Bias in Large Language Models (LLMs): Implications and Applications in Finance”, Miquel Noguer I Alonso addresses sources of LLM look-ahead bias… Keep Reading

A reader asked: “I am wondering how come you have not rated Motley Fool guys. Any insight?” To augment the test of Motley Fool public stock picks in “‘Buy These Stocks for 2019’ Forward Test”, we evaluate stock picks for 2021, 2022, 2023 and 2024 via “10 Top Stocks That Will Make You Richer in 2021”, “7… Keep Reading

How do exchange-traded-funds (ETF) focused on development of robotics-artificial intelligence (AI), an arguably hot area of technology, perform? To investigate, we consider eight of the largest such ETFs, all currently available, as follows: Robo Global Robotics and Automation Index ETF (ROBO) ARK Autonomous Technology & Robotics ETF (ARKQ) Global X Robotics & Artificial Intelligence ETF (BOTZ) First Trust… Keep Reading

Does commercial and industrial (C&I) credit fuel business growth and thereby drive the stock market? To investigate, we relate changes in credit standards from the Federal Reserve Board’s quarterly Senior Loan Officer Opinion Survey on Bank Lending Practices to future U.S. stock market returns. Presumably, loosening (tightening) of credit standards is good (bad) for stocks. The… Keep Reading